5 Challenges to Adopting IIoT & Industry 4.0

They say that necessity is the mother of invention, and when it comes to new technologies, specifically Industry 4.0 solutions, that is absolutely true. Evolution stems from real pain. In the case of manufacturing, pain is driven by volatile market demands for better and faster manufacturing procedures, margins that continuously decrease, and fierce competition between companies that no organization can win without the help of smart technologies.

Simultaneously, the world is currently grappling with health, social, and economic crises unraveling due to the Coronavirus pandemic. It’s becoming increasingly clear that we will come out the other end significantly different since COVID-19 is, clearly, a game-changing event. It is obvious that now, more than ever, implementing Industry 4.0 tools is crucial for the short and long-run.

Industry 4.0 Gaining Traction

According to a PWC survey, 91% of industrial companies are already investing in digital factory formation with clear goals and ROI expectations for the next 5 years. Companies understand that this is a marathon rather than a sprint and are willing to put in the time and work more than they were before.

Since no journey is ever without a few hurdles, there are several things to consider, including the main challenges that manufacturers face today as they begin to embrace Industry 4.0 technologies. These challenges can deter some manufacturing businesses from adopting these tools, which may cause them to fall seriously behind their competition. To help companies avoid this outcome, we’ve also added some tips from world-renowned experts to help overcome these challenges in the best way possible.

Challenge #1: Legacy and Outdated Systems

Solutions that allow a seamless integration into data-systems are the key to success. Today’s most advanced manufacturers are already leaning on multiple legacy data-systems, from Excel sheets to ERP systems, MES systems, or other tools. Therefore, they are concerned about adding more systems that are not flexible enough in terms of integration to the mix. They don’t want to spend a fortune and endless resources on setting up new tools, and they don’t want to be constantly busy coordinating or closing data gaps between systems.

Contrary to a common misbelief, there’s no need to replace a company’s entire infrastructure to implement the necessary Industry 4.0 solutions. In many cases, there’s no need to sweat over the integration. Many of today’s IIoT solutions offer an easier path towards innovation and enable companies to make a few small adjustments and add intelligence, sensors, and automation on top of the existing structure.

Many leading manufacturers overcome this challenge by adding new technology layers to legacy systems that continue working as before. This simplifies the Industry’s 4.0 onboarding process.

By using new layers of technology, they can:

• Seamlessly integrate with all legacy layers and import data and functionalities so that everything is under one single framework
• Add Artificial Intelligence capabilities such as predictions, alerts, and recommendations
• Automate manual processes, such as update systems with data or create reports

Challenge #2: Understanding the ROI of Industry 4.0 Solutions

It can be tricky to estimate the ROI of Industry 4.0 solutions, which is more than enough to scare some companies away. Manufacturers that consider embarking on such an in-depth journey want to know AHEAD of time what’s in it for them and ensure that the investment is worthwhile, which is understandable.

To truly answer this question, it’s not enough to present numbers regarding any dedicated field's possible future developments. Instead, we must translate terms like AI and automation into efficiency, productivity, and alike. This is especially relevant now when cutting costs has become increasingly important as we return to production and get back to routine amid the Covid-19 pandemic.

There is a need to shift from PoC (Proof of Concept) to PoV (Proof of Value). In other words, during piloting the technology, show not only that the technology works but mainly the business value and improvements that it brings.

Challenge #3: Deciding on the Practicalities 

The Industry 4.0 revolution is transforming the manufacturing field (as well as many others), making it equally exciting and overwhelming.

It’s not always clear how to take the first practical steps. Should new solutions replace existing systems or be added on top of them? What budget should be allocated? What should executives be appointed for the project? Also, which areas should we focus on first: should it be material management and savings? Perhaps tool and inventory management? Quality control and process optimization?

What is the best way to measure success? What can be expected in terms of the results? Yes, a lot of questions. The possibilities are endless, but you do have to start somewhere, which makes determining your next step a real challenge. This holds many manufacturers back.

First, start with defining the main business problem you wish to solve. Businesses that measure their agility and automation levels, for instance, might learn that given the company’s levels of manual labor, these are the solutions they should focus on right now, whereas their time-to-market technologies still serve them quite nicely. This initial exploration stage is important and when conducted with the right focus can lead to smart conclusions.

Second, and as for how to manage an Industry 4.0 onboarding project (in terms of costs, project management, expectations, success measures, training, etc.) businesses should lean on the technology vendors selected.

Challenge #4: Utilizing Data 

There’s no doubt that IIoT technologies drive companies to collect data like never before, but when it comes to putting said data to use, that’s where things get a little blurry.

Manufacturers are challenged by the amount of data collected, and they don’t know how to leverage it for their business goals. Understanding how to leverage specific data for your specific KPIs is critical when onboarding the right industry 4.0 tools that best match your goals, which is a challenge within itself.

Manufacturers should know how to analyze and utilize data wisely, or else the wrong conclusions might be reached. Many manufacturers end up gathering a massive amount of data in today's reality, only to sit and stare at endless information with no clue as to how it should be interpreted.

Think of a navigation dashboard. It provides a lot of information, but can a driver use it while driving from point A to point B? Is it enough?

As the human ability to both predefine the importance of all available contextual data and calculate the implications of the data is limited, many manufacturers moved to work with technologies that overcome the challenge and take the load by:

• Automating data collection –– manufacturers need not worry anymore about the resources and energy invested in gathering so much data.
• Generating actionable insights based on that data and by leveraging AI. Let the machines run complex calculations, predict future scenarios based on historical data, simulate different decisions and their consequences, and send simple and clear recommendations as to what to do.

Challenge #5: Too Much of a Good Thing

There are endless possibilities in IIoT, but countless offerings and promises pop up on every corner. Manufacturers find it challenging to decide which vendors to collaborate with based on their current state and future goals, which experts to consult with, and how to find their golden nugget in the sea of technologies and professionals.

This is not to say that many of the options out there aren’t good, but what works for one manufacturing business will not fit another, and it's vital to know how to select a partner that fits you and your business. Companies must first assess their business persona needs, and only then examine the solutions and vendors' abilities to address it.

Out of the Box Tactical Plan

As we get back to routine in today's reality, manufacturers will now need to create an out of box tactical recovery plan that will set their near future. History shows that the strongest players came out of crisis even stronger.

It’s rather obvious that the above list doesn’t cover every single challenge that manufacturers face as they embark on the Industry 4.0 journey. The ever-changing nature and fast pace of IIoT technologies also mean that this list of challenges will continue to evolve over time. Topics like data ownership and knowledge preservation, for instance, are becoming crucial nowadays.

This article, which covers some of the biggest, most important issues for manufacturers today, is mainly focused on sending one clear message: every challenge has a solution, and each solution should be properly researched and implemented step by step.